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struggling with 4 part problem CI 1 Required Information The following information applies to the questions displayed below) Execusmart Consultants has provided business consulting services
struggling with 4 part problem
CI 1 Required Information The following information applies to the questions displayed below) Execusmart Consultants has provided business consulting services for several years. The company has been using the percentage of credit sales method to estimate bad debts but switched at the end of the first quarter this year to the aging of accounts receivable method. The company entered into the following partial list of transactions a. During January, the company provided services for $240,000 on credit. b. On January 31, the company estimated bad debts using 1 percent of credit sales. con February 4, the company collected $120,000 of accounts receivable. d. On February 15, the company wrote off $700 account receivable. e. During February, the company provided services for $190,000 on credit 1 On February 28, the company estimated bad debts using 1 percent of credit sales 9. On March 1, the company loaned $12,000 to an employee, who signed a 11% note due in 3 months h On March 15, the company collected $700 on the account written off one month earlier On March 31, the company accrued interest earned on the note J. On March 31 , the company adjusted for uncollectible accounts, based on the following aging analysis, which includes the preceding transactions (as well as others not listed). Prior to the adjustment, Allowance for Doubtful Accounts hod on unadjusted credit balance of $6,800 ces Number of Days Unpaid 31 to 60 61 to 9 $ 800 to 30 $900 over 90 Customer Arrow Ergonomics Asymmetry Architecture Others (not shown to save space) Weight Whittlers Total Accounts Receivable Estimated Uncottectible (9) Total $ 2,200 2,400 85,500 2,400 $ 92,500 $ 500 5,400 43,000 5 2.400 4,400 32,700 2,400 $36,000 20 $ 43,000 101 $ 5,900 201 5.6,800 401 Required: 11 Nav Required information accounting equation. TIP In item you must first calculate the desired ending balance before adjusting the Allowance for Doubtful Accounts. (Do not round Intermediate calculations, Enter any decreases to Assets, Liabilities, or Stockholders Equity with a minus sign.) 240.000 2.400) 0 Assets a Accounts Receivable b. Allowance for Doubtful Accounts Ic Cash Accounts Receivable d. Allowance for Doubtful Accounts d. Accounts Receivable occounts Receivable Allowance for Doubtful Accounts Not Receivable (short) Stockholders Equity 01 Service Revenue 0 + Bad Debt Expense 0 ol 0 - ol o Service Revenue oload Dot Experte 0 - 0 240,000 (2400) 120,000 (120,000) 700- (700) 190.000 (1.000) 12,000 (12.000) (700) 700 (700) 700- 110) 190,000 (1.000) 0 o con ol 0 o ol Alowance for Dout Account h Accounts Receivable Accounts Receivable In. Cash Les Receivable Allowance for Doubtful Accounts 0 110 01 o interest Revenue oled Dot Expense View transaction list Journal entry worksheet Record the adjusting entry for bad debts as of February 28 using 1 percent of credit sales method. Note: Enter debits before credits Debit Credit Transaction 1. General Journal Bad Debt Expense Allowance for Doubtful Accounts Record entry Clear entry View general journal Journal entry worksheet 11 Record the adjusting entry for bad debts as of March 31, using the aging of accounts receivable method. Note: Enter debits before credits Transaction General Journal Dobit Credit Record entry Clear entry View general journal 3. Show how Accounts Receivable, Notes Receivable; and their related accounts would be reported in the current assets section of a classified balance sheet at the end of the quarter on March 31. es EXECUSMART CONSULTANTS Balance Sheet (Partial) At March 31 Assets Current Assets Accounts Receivabin $ 92,500 Allowance for Doubtful Accounts 9,000 Accounts Receivable, Net of Allowance Number of Days Unpaid 31 to 60 61 to 90 $ 800 $ 500 to 30 $ 900 Over 90 Customer Arrow Ergonomics Asymmetry Architecture Others (not shown to save space) Weight Whittlers Total Accounts Receivable Estimated Uncollectible (%) Total $ 2,200 2,400 85,500 2,400 $ 92,500 43,000 5,400 $ 2,400 4,400 32,700 2,400 $ 36,000 24 $ 43,800 105 $ 5,980 204 $ 6,800 40% 4. Sales Revenue and Service Revenue are two income statement accounts that relate to Accounts Receivable. Name two other accounts related to Accounts Receivable and Notes Receivable that would be reported on the income statement and indicate whether each would appear before or after Income from Operations for Execusmart Consultants. Execusmart Consultants would report Income from Operations, Income from Operations Step by Step Solution
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